tv 2014 Economy Summit CSPAN March 24, 2014 3:40am-4:16am EDT
conversation on the state of the economy with chris van hollen, a ranking member of the house budget committee. a hand for david graham and chris van hollen. [applause] >> where you want me? >> i think right here. >> congressman, thanks for being here. let's jump right in. there seems to be this idea that maybe the budget wars are over. as ryan murray suggested, the détente. is that what it looked like from where you are? what can we look forward to in the next few months? >> first of all, it's great to be here. i appreciate the opportunity. i think you have a temporary truce on the budget wars. the budget agreement that was reached in december carries us through fiscal year when 2014 and 2015.
you have an agreement to increase spending on those by 2015 you are back to current law, and that is the sequester with the deeper across-the-board cuts. look at some point we are going to have to resolve those issues. there were concerns we would have another showdown about the debt ceiling. we were able to approve the debt ceiling without too much forensics. there is some talk, and it is only talk, that the house republicans -- my colleague paul ryan may be considering putting forth a budget proposal that would actually change parts of the ryan-murray agreement.
i hope that is not the case because that would route -- would create unnecessary disruption. there is talks they try -- they will try to increase the defense spending and reduce the nondefense spending for 2015. i should be clear, those numbers were very carefully negotiated. if there was a move in that direction it would create unnecessary uncertainty. as of now, a temporary truce and hopefully that will last. >> you were pretty lukewarm on this deal. you said it was not a perfect deal but it was great there was an agreement. how would a change play out, what would it look like politically and what -- and how with the process go? >> if you have a change in agreement that would show -- that would throw a monkey wrench in the process. the appropriators, the people that actually make the decisions about how to spend and allocate funds within those limits, they
have been able to get to work. for years they have not been able to get to work because there has not been an agreement between the house and the senate, between democrats and republicans as to what the overall numbers are. if you were to change the agreement he would throw that up in the air. i do think the agreement was a positive development but it was far from perfect. the president's budget attempt to address some of those issues by saying within the limits he allocates resources and he suggests it would be better for the country if republicans or democrats could get together to agree to increase our investment in nondefense spending. also increase our military readiness by actually providing $28 billion in additional funds. >> let's talk about the earned
income tax credit. many people said it was the greatest possibility for bipartisan. do you see your colleagues going along with that? >> i hope so. she combated poverty and made sure work pays. the idea here is to extend that to childless workers. right now it applies to individuals who are working with families. according to most projections, it would help lift substantial numbers of people out of poverty. i hope we can move forward. the price tag is over $78 billion. in budgeting the question is always how you are going to offset that. the president offsets that in his budget by reducing certain tax breaks and benefits in other
areas. i'm not sure our republican colleagues would agree to that approach or not. >> is the policy agreed or could you imagine siding on the extension itself? >> we will have to seek -- to see. i'm not sure. for example, one question will be what -- will be if and when the house republicans put their budget forward, will they include this extension? that is the first clue on if they want to before this idea. >> how about the minimum wage. is it fair to say that is a nonstarter? >> we are trying to get a vote on the minimum wage in the house. the democrats have filed a discharge petition, trying to
collect signatures to essentially pressure the speaker of the house to bring that up for a vote. we are confident that if it had actually had a vote on the memo wage -- if it actually had a vote on the minimum wage increase it would get a majority vote. so far the speaker has not allowed us to have that vote. i think the votes are there. the question is the opportunity to actually get the boat and let the house work its will. >> we are praying on that theme. something your democratic colleagues sent over -- unemployment insurance. this is something democrats have said is important to the economy and the people. tell me about the prospects there. >> that is another sore point in the house. one other bill and mentioned -- minimum wage increase, extension
for unemployment compensation, and immigration reform are things we think the house should vote on this year. they are all important measures to the country. they can vote yes or no but we should at least have a vote. as you indicated the unemployment compensation extension is not only important to the families who are struggling -- we still have an economy where three people are looking for each job. it is good for the general economy. dr. elmendorf indicated that if you extend unemployment insurance through the end of this year you would save or create about 200,000 jobs by the end of this year. that is because when people are able to pay their mortgage, pay their rent, go to the grocery store and buy goods, it is good for their local economy and the national economy.
people can't make the payments if it just has a negative effect on the surrounding economies. >> we have talked about these concrete policies democrats have put forward. we see a lot of republicans focusing on poverty in a can -- in a new way. paul ryan is probably the most visible in doing that. are they taking this seriously now? is this a new change, is it a cynical ploy? what is really going on and is there somewhere we can agree on on both sides? >> the test of whether or not this is serious will be in the house republicans budget. budgets are an expression of our priorities, values, what we care about. in the past despite a lot of talk with our colleagues about confronting poverty, the budget have decimated very successful
anti-poverty efforts. we all know we can do better on the war on poverty. tens of millions of americans are still below the poverty line. that is unacceptable. if you look at the time from 1967 until today, or 2012 with the latest data, it shows the initiatives that have been taken over that time result in about 40 million fewer americans in poverty. it would be a big mistake to unwind some of the important measures that are in place. we can look at reforms if the goal is to improve and strengthen those programs. last year's republican budget slashed medicaid, which is already a health program that has the lowest cost per capita increase of any health programs from a whether it is the private market or comparing it to the medicare.
they would essentially cut that $800 billion over a 10 year period. this is a question of what is your budget -- what does your budget do you? not what you say. paul ryan is a friend of mine but we have disagreements on these policy issues. i think they fundamentally misdiagnosed the problems. his recent comments suggests this is a lack of motivation, that people just do not want to work. there is a culture of not wanting to work written think the problem -- a culture of not wanting to work. i think the problem is a lack of opportunity and i think it is important we identify the key issues here.
if you slash important programs that provide some basis of security, it will be worse. >> we see the report on the war on poverty that argues all of these programs haven't really worked. there are too many things going on, the pocket he rate hasn't fallen nearly enough, and we haven't made a dent -- poverty rate hasn't fallen nearly enough, and we haven't made a dent in poverty. >> if you look at that report is an inventory of different policy initiatives over a. bank -- over a period of time. it is a catalog of different programs. the opening statement begins with a false premise, and that is that we have not made any progress. the council of economic advisers did a very exhausted of -- very exhaustive report in january. what they found is that we have
seen a 40% reduction in poverty compared to where we would be with how these measures have been put in place over time. the premise that we have not made any progress is simply false. if you start with that premise you say let's get rid of these programs as opposed to look for ways to improve them. i don't think you can improve the food nutrition program by cutting $140 billion out of it. i mentioned medicaid, which is an important health care program for seniors and also for lower income families. that is already on a shoestring. there are already low reimbursement rates. to take almost $1 trillion out of that program would simply be at death knell. >> there were things you liked,
you mentioned the gingrich loophole, the kerry loophole. republicans seem less fond of this plan. is there any hope of this going forward? >> the interesting thing about the tax plan is the people who put on the running shoes the fastest and running away from it were speaker boehner and republican colleagues. i give dave camp credit for putting something concrete on the table. there is lots not to like him to david kamp plan. what he did was make the point many of us were making over the last years. it is harder than you think to bring down rates in a deficit neutral manner, in other words by eliminating certain tax benefits, tax expenditures. for years the house republican
budget has said we are going to drop the tax rate from 39% down to 25%. we have pointed down repeatedly during these budget discussions that you cannot do that without actually increasing the tax burden on middle income americans. we think the map shows that. i think dave camp has proved that. if you look at his plan, you actually have a top marginal tax rate. he also put a lot of provisions in there to try to make it deficit neutral in the last 10 years. he has the bank fee and think tax in there. he has a lot of other provisions in there. he has made the point a lot of us have made, which is this is harder to do than you think. i should also point out that even with everything he did to try to make it deficit neutral,
most people believe it will significantly increase deficits in the second 10 years. he because he moves forward through various changes, going from 401(k)s to iras, it moves revenue into the next 10 year window. that revenue that will come in the second 10 years is no longer there with increased deficits. lots of big questions. >> when he gives up the gavel, will this create a template going forward? >> i think the different components of that are certainly things that are going to be in play and discussed. if and when we are able to move forward on a company of tax reform legislation, these are ideas that are out there. i'm sure when we have a
discussion on the budget this year in the house budget committee we will have a healthy discussion of some of dave camp's proposals as well. there is one area in the tax reform universe that is at least overlapping in principle. that has to do with corporate tax reform. if you look at the president's proposals, dave camp proposals, while they are different there are some important principles. there is some overlap in the way they deal with international taxation. interestingly both proposals use some of the income captured as part of corporate tax reform to increase the transportation trust fund, our infrastructure investment.
we haven't mentioned that i would say that has to be an important national priority. in the past year there is not enough revenue coming into our federal transportation trust fund to do the work that needs to be done around the country. all new projects, all new funds for projects will come to a halt in september if hungers does not get its act together. of there are some things -- if congress does not get its act together. >> for years republicans have been talking about the budgets president obama put forward and there is not a lot of movement on that. what will it take for some sort of change? >> this is something that worries a lot of us. we need to come up with a long-term plan for our national infrastructure investment. right now, as with so many other
things in congress, we are on a week to week and month to month short-term horizon. the key issue comes down to funding for the transportation trust fund. either you essentially borrow the money from the general fund and dedicated revenues. if you don't replenish those and come up with a mechanism to expand those resources, then you are borrowing from the general fund. there are a number of proposals to deal with this. if our republican colleagues don't put up that idea than they should put out another idea on how to pay for.
if they want to pursue dave camp's proposal that's fine. >> you mentioned doug elmendorf, who was up here. he has not been especially kind to democrats. reports have suggested there'll be a negative impact on employment. it seems to have stalled political momentum. do you worry about what the cbo projections have been saying? >> i want to salute dr. elmendorf because he has a tough job being the umpire of who calls the balls and strikes. there will be times where one party or another does not fully agree with this assessment. if members of congress could to make up their on projections you can imagine -- as crazy as the budget process is now it would get that much worse.
when dr. elmendorf pointed out the economic recovery helped save millions of jobs in this country, republicans did not like it. there is some of his analysis that democrats may not always love it. on the two issues you raised i did want to point out the fundamental misunderstanding that surrounded one of their proposals. if you go to work for your employer you get a tax break. your employer gets to provide you with health care tax benefit. people who go to work with employers who provide health insurance are essentially getting a tax subsidized health insurance. that kind of tax benefit was not accessible for people who do not go to work within employer.
we have a system where we can purchase the health care in the exchange. everyone acknowledges we have a lot more work to do you you can access a tax benefit -- work to do. you can access the tax benefit and that frees up more choices for people. i want to be clear the cbo assessment with respect to employment said in the out years, as people have more choices they may select not to work as many hours were selected to work at a particular job that they were working because that was their only way to access health care. it wasn't that they were going
to be thrown out of their jobs, it was they have the ability to access the tax credit elsewhere. we can talk about the minimum wage issue as well. they projected in the year 2017 you would have 500,000 fewer jobs. this year if we extend unemployment insurance we would have 200,000 additional jobs. if you adopted immigration reform you would see job growth that would dwarf what the project in the out years. finally the minimum wage also is going to benefit over 20 million americans directly and then millions more. it is just wrong that in our country you can work full-time and still be below the federal poverty line. i think it is a value we should adopt as a country that if you work full-time, 40 hours a week, you should not fall below the
federal poverty line. >> one strict political question, what moral support are you offering your successor? >> steve is doing a terrific job. it is a hard job. i think as we go into the november election cycle, what democrats would like is for them to be able to punch through some of the specific proposals with respect to the economy. early education, minimum wage, on those policy issues every one suggests it will be a strong support. there is so much polarization, so much focus on dysfunction. we are just going to work hard
to get the best job. midterm elections are huge issue on both sides. >> good morning, my name is daniel plummer with daniel plummer incorporated. we are a business and internet strategy company. is congress doing anything to address the student loan debt? specifically legitimate program that what awaits the debt for any service. is congress working to reform a lot of the credit laws passed in the past 12 years with high consumer interest rates? >> this is a huge issue for the country. i think we are up to a trillion dollars in student loan debt. we are also an economy we want
to make sure that in order for people to have the chance to compete in go ahead they can go to college. affordability should not be a major obstacle. there are three areas where the federal government has moved. we have increased the size of payments. this is another difference. the house republican budget would significantly cut support for the program. we worked to keep down the interest rates of the subsidized federal student loans. they were going to double to 6.8%. we were going to keep them lower. the third case directly addresses the question you raised, which has to do with the ability to repay. there are a number of opportunities for people now, either through public service or other kinds of service that they can see a reduction on their
loan payments. there are also safety nets or fire breakers that if your income is below a certain point then you can pay off your student loan over a much longer. -- much longer period of time. even though support for federal student loans has gone up, so has tuition. it has been difficult to try to develop a system that ties federal student loan or grant assistance to the question of the tuition being charged universities. we are looking at that but it's hard. some universities may be increasing their tuition just because they want to expand
operations. during the economic turn down, because there were less resources coming in to state coffers they cut that their contributions to universities and universities had to struggle to increase their tuition in order just to maintain current service. there are lots of moving parts here. we would invite anybody who has an idea on how you can tie federal assistance to some student accountability. it is a tricky area. in terms of the other credit programs, i'm not sure exactly which ones you may be referring to. we have been looking at a number of reforms of various programs, at least in the house and other areas. i can follow up later. >> we have time for one more question. >> just a follow-up to the prior
question, i'm not suggesting this is a father-son chat. what do you see in the new pew poll numbers that changing attitudes in the oncoming generation and what effect might that have on the competition of house of representatives over the next six to eight years? >> changing social attitudes as as they bleed into political convictions. >> that is a very good and very tough question. it is hard to predict how this will impact our politics going forward. i think you see a mix of attitudes among young people. one is on a lot of the social issues. they tend to be generalized and more socially liberal.
when it comes to gay rights, when it comes to a number of the other issues like that, i think that you are going to see a continuing trend. if you look at that issue is one good example we see incredible changes in the country in a very short time. i think that is driven by younger voters and the next generation. i'm not sure yet how all their attitudes will sort of shape economic policy going forward. there are lots of questions about where the younger generation will ultimately gravitate to politically. the coalition of young voters was important to president obama's election. also 2012. not as much energy and enthusiasm, but a significant
voting block. thoseestion is whether trends among young people will continue. there is a fair amount of evidence that people tend to stick with their choices of political parties. wrote their lives on average. -- throughout their lives on average. it is a good question. a lot of people are spending time and effort trying to get an answer. a big part of campaigning these days is trying to harness the information available. social media. all the data out there. to get a better idea of how voters are thinking, not just young voters but across the board. >> thank you very much, congressman. i appreciate it.
job.rrific the one question he wanted to ask but didn't get to -- what would lbj do today? >> let me take a second to answer that question. the answer is yes. but in terms of congress. i think the president has been dealt a tough hand. that is my personal view. we went through a litany of issues where we were trying to get a vote in congress. if we can get a vote, i think we could move forward. he cannot make them. >> thank you
this is half an hour. about me say a few words grover norquist. he was president of americans for tax reform. dubbed by 60 minutes as the most powerful man in washington. how many of you watch stephen colbert? if you do not watch it, turn it on. cold air had grover on many occasions here and he had him on ad grover on many occasions and he had him on. take all of the grandmothers and put them in a container underground and we will smother the honey. unless you agree to raise taxes, we are going to let the fire ants out. he says, would you give in and raise the taxes? grover said we have got the memory and the photos. we will rest well.
grover was in my office. he stopped in on one occasion. he had this big black case. on top of that case, i happened oath that was a paper sheet. it was signed by stephen cole stephen colbert. imagined to have that case with all of your secrets in it sitting in my office for at least a day and a half. i did not even tell you i had it. i thought i would auction it on ebay and see what i could get. without further ado, please derrick thompson with grover norquist. [applause] >> thank you, everybody. one of the themes of the last session was long-term thinking.
it was sort of scattered. we'll from the short term to the daveterm starting with camp's plan for tax reform. he had been talking about it for a long time. my understanding is that a lot of members of the republican party have said they cannot support something that raises taxes by this much in a financial institution. what do you see is a positive and a negative? >> the positives are the lower rates. 35% and five percent average at the state level. we are at 40 compared to europe which is 25%. a dentist down toward the 25% average. -- it isost the local a step in the right direction.